Stocks fell a day after the Nasdaq crossed 5,000 for the first time in 15 years, and the S&P 500 climbed to a new high.
First, the scoreboard:
- Dow: 18,203.6, -85, (-0.5%)
- S&P 500: 2,107.8, -9.6, (-0.5%)
- Nasdaq: 4,979.7, -28.4, (-0.6%)
And now, the top stories on Tuesday:
- The pace of US auto sales fell to 16.2 million in February, missing expectations for sales to come in at a pace of 16.7 million. All the major car manufacturers missed expectations for sales last month, including Ford, which missed estimates the most with a 2% decline versus +5.8% estimated, General Motors with a 4.2% gain versus 5.9% expected, and Honda, with a 5% gain versus 11% forecast. Ahead of the data releases, UBS’ Maury Harris noted that dealers had reported weaker sales because of the cold weather.
- Alibaba shares fell to an all-time low, falling up to 3.7% to trade close to around $US80 per share. Shares of the Chinese e-commerce company, which went public last September, are around 40% from their peak. The Wall Street Journal reported Monday that Alibaba vendors were paying clients to buy their products and write them positive reviews, a practice known as “brushing.” In late January, the Journal also reported that the Chinese government had accused Alibaba of failing to crack down on “brushing” on its biggest platform, Taobao.
- Shares of Lumber Liquidators rallied after falling up to 25% on Monday. In a report on CBS’ “60 Minutes,” the company was said to produce laminate flooring products with levels of formaldehyde, a cancer-causing chemical, that violate regulations set by the California Air Resources Board (CARB). Its shares rallied as much as 13% on Tuesday, after analysts at Janney Capital Markets upgraded the firm to “Buy” from “Neutral,” writing: “We believe 60 Minutes did not provide a complete picture of the issue.” In its response on Monday, Lumber Liquidators said 60 Minutes had improperly tested its products.
- American Express was downgraded to “Underperform” from “Neutral” by Macquarie Research. In a note Tuesday, Macquarie ‘s Vincent Caintic wrote: “Intense competition makes it difficult for AmEx to maintain share, even with strong industry spends trends in consumer and commercial.” Caintic also cautioned investors against being long into the company’s March 25 investor day meeting, and said that from current levels, there is only about 7% potential upside to AmEx shares, while downside potential is “significant” at 21%. Macquarie forecasts flat earnings growth for AmEx in 2016 due to the loss of the Costco deal.
- Best Buy , the largest U.S. consumer electronics chain, reported better-than-expected earnings results. Total same-store sales rose 2% during the fourth quarter, slightly better than the 1.9% rise estimated. Same-store sales rose 2.8% in the second straight quarter of growth after three consecutive periods of declines. Net income attributable to Best Buy shareholders jumped to $US519 million, or $US1.46 per share, from $US293 million, or 83 cents per share, a year earlier. Revenues jumped 1% to $US14.21 billion from a year earlier. The company announced it will buy back $US1 billion of shares over the next three years.
- Share buybacks in February from S&P 500 members surged to a record in February. Bloomberg reported that companies in the benchmark index announced $US104.3 billion in planned buybacks last month. Wall Street legend Art Cashin noted, “[Companies] are on a pace to spend about 95% of their earnings on buybacks and dividends. No wonder we’re at new highs.”
DON’T MISS: The 50 US state economies from worst to best »
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.